For the primary quarter of 2021, German airline Lufthansa recorded a lack of €1 billion and concurrently introduced the elimination of a further 10,000 jobs.
An preliminary announcement of 30,000 redundancies was already elevated to 50,000 final yr. With the job cuts now unveiled, this determine will rise to 60,000, or greater than 43 p.c of the 138,000 workers on the airline in 2019. According to firm figures, 24,000 full-time jobs have been eradicated over the previous 12 months.
Lufthansa’s finance director, Remco Steenbergen, has threatened to impose obligatory redundancies. “We’re preparing for layoffs,” he warned on the quarterly replace. The intention is to chop 10,000 full-time jobs “or make comparable savings in staffing costs.” This will function the pretext for the commerce unions to implement further wage cuts, allegedly with the intention of saving jobs.
The commerce unions energetic at Lufthansa, together with the service workers union Verdi, the Cockpit Association (VC), and Independent Flight Attendants Organisation (UFO), provided wage concessions to Lufthansa final yr totalling €1.three billion. Cockpit agreed to chop pilots’ wages by as much as 50 p.c. As a consequence, Lufthansa saved some €600 million. The UFO agreed to financial savings that can lower prices for the airline by half a billion euros by the tip of 2023.
Then in November 2020, Verdi gave up workers’ vacation and Christmas pay, in addition to accepting a wage freeze and the suspension of all advantages till the tip of 2021. Thus “the ground staff are shouldering cost-cutting contributions of over €200 million to overcome the crisis,” acknowledged Verdi deputy chief Christine Behele, who can be deputy chair of Lufthansa’s supervisory board. On the premise of the settlement with floor workers, as much as 50 p.c of staffing prices for this group of workers may very well be saved, enthused human sources chief Michael Niggemann.
Wage concessions on such a massive scale symbolize “a new dimension of trade union sellouts,” because the World Socialist Web Site commented in early December.
The airline is now reporting that working income declined to €four billion, in comparison with €eight.2 billion throughout the identical interval a yr earlier. Therefore, regardless of a 60 p.c lack of income in comparison with the identical interval final yr, from €6.four billion within the first quarter of 2020 to €2.6 billion this yr, the losses have been halved, from €2.1 billion to €1 billion.
The sellout from final yr is now coming into its second spherical. The present lack of €1 billion is to be squeezed out of the remaining workforce. The firm is presently negotiating with the VC and Verdi unions on further cuts for 2022.
Lufthansa chief govt Karsten Spohr complained that Lufthansa and the Cockpit Association have stumbled within the disaster from one short-term answer to a different. The disaster settlement below which pilots’ salaries are lowered runs out already subsequent March, he added.
He then defined how the cuts are to be made everlasting. In December, Lufthansa calculated it had a surplus of 1,000 pilots and co-pilots, or about 20 p.c of all cockpit workers. The aim of the present talks between Lufthansa and VC is to chop prices by the use of obligatory part-time work. “Ultimately, five pilots will then do the job of four, everyone flies 80 percent and nobody has to leave,” acknowledged Spohr. It hardly must be famous that wages may even be lower by 20 p.c.
VC has already declared its assist for such part-time preparations for the 5,000 pilots at Lufthansa, Lufthansa Cargo, GermanWings, and Lufthansa Aviation Training (LAT).
The state of affairs at Lufthansa Cargo demonstrates that these job and wage cuts will not be merely the results of the coronavirus pandemic. While all passenger airways have recorded losses, Lufthansa’s freight enterprise made file income. This is just not solely as a result of passenger plane are serving as freight carriers. Due to the elevated demand for freight and a restricted provide of suppliers, costs are presently excessive. Lufthansa Cargo earned an working revenue of €314 million.
Nonetheless, Lufthansa introduced two months in the past that it’s going to lay off near half of its freight pilots. The trade web site aero.de reported in early February, “While Lufthansa Cargo went into the crisis year 2020 with 475 pilots, the airline plans in the future to employ just 250 freight pilots, according to sources associated with the company.”
One pilot advised the web site, “We’ve been flying to the limit for our Lufthansa over recent months, and now our wages will be cut from August and freight contracts increasingly outsourced to Aerologic. The atmosphere is boiling over.” Aerologic is a three way partnership between DHL and Lufthansa Cargo, and doesn’t function with collective agreements. The wages at this cheap-labour subsidiary are subsequently decrease than on the guardian corporations.
This manner of doing enterprise might be acquainted to readers of the World Socialist Web Site. Several airways and air journey corporations function in keeping with this enterprise mannequin. At WISAG Ground Service at Frankfurt Airport, 230 baggage dealing with and bus staff have been struggling for six months to defend their jobs.
In December, WISAG laid off workers who had labored for many years on the airport as a result of they refused to change to a different subsidiary and quit all the rights they’d laboured to attain. The billionaire Wisser household is now using short-term contract staff on decrease wages to carry out the work of the skilled, laid-off staff.
While workers are being bled dry on the pretext of the coronavirus pandemic, the board of directors and shareholders are using the pandemic to gorge on billions of euros.
Early last year, the federal government handed Lufthansa a bailout programme of €9 billion. This led to a rapid rise in the company’s stock value and increased the wealth of shareholders. At the same time, it was used to finance the restructuring programme.
The fact that companies receiving state support are prohibited from paying out performance-based bonuses to managers has largely been ignored by the Lufthansa board. According to a report in Der Spiegel, a legal report produced by the law professor Dirk Verse in January on behalf of the supervisory board came to the conclusion that company management can make good on their claim to certain long-term performance-based benefits that were granted prior to the state’s intervention.
At the Lufthansa supervisory board meeting on March 3, the paying of this portion of bonuses was to have been confirmed. The federal government intervened, not because they didn’t want the executives to have the bonuses, but because the payments violated European competition law and could have played into the hands of Lufthansa’s European rivals.
Lufthansa’s directors and supervisory board are now determined to end their dependence on taxpayers’ money. This would clear the way for bonus payments, and even dividend payouts to shareholders.
At the beginning of April, Lufthansa announced that at its annual shareholders’ meeting on Tuesday it will ask shareholders to vote on a capital injection of €5.5 billion in order to pay back the government bailout. According to Spiegel Online, the airline’s management has only used around €3 billion of the bailout funds to date, and instead sought to raise money over recent months on the private capital market. As a result, Lufthansa has already paid back a €1 billion loan from the state-controlled KFW Bank ahead of schedule.
If management is demanding a reduction in staffing costs, the trade unions subserviently rush to oblige. And when the issue is rescuing the multi-million-euro incomes of top executives, the trade union representatives on the supervisory board are only too happy to assist. They are handsomely rewarded for doing so. In 2019, the 10 so-called employee representatives on the Lufthansa supervisory board earned over €1 million for their close collaboration in drafting cost-cutting proposals and job cuts.
It is high time to break with these corrupt organisations. Jobs, wages, and social achievements can only be defended independently of the trade unions. To coordinate this fight globally, the International Committee of the Fourth International is calling for the formation of the International Workers Alliance of Rank-and-File Committees.